Exit Exam Marketing Review
Table of Contents
Some Definitions ............................................................................................................................... 1
Consumer Markets and Consumer Behavior .................................................................................... 2
Managing Marketing Information to Gain Customer Insights ........................................................ 3
Customer-driven marketing strategy: market segmentation, targeting, differentiation, and
positioning ......................................................................................................................................... 3
The Promotional Mix ........................................................................................................................ 5
Marketing channels ........................................................................................................................... 6
Product, Services, and Branding Strategy ......................................................................................... 7
Some Definitions
- Marketing: It is a process by which companies create value for customers and build strong
customer relationships to capture value from customers in return
- Marketing Concept: managerial philosophy that organization should satisfy customers’ needs
through a coordinated set of activities that also allows the organization to achieve its goals
- Market offerings are some combination of products, services, information, or experiences offered
to a market to satisfy a need or want
- Marketing myopia is focusing only on existing wants and losing sight of underlying consumer
needs
- Exchange is the act of obtaining a desired object from someone by offering something in return
- Markets: Markets are the set of actual and potential buyers of a product or service.
- Marketing management is the art and science of choosing target markets and building profitable
relationships with them
- Market segmentation refers to dividing the markets into segments of customers
- Target marketing refers to which segments to go after
- Production concept is the idea that consumers will favor products that are available or highly
affordable
- Product concept is the idea that consumers will favor products that offer the most quality,
performance, and features. Organizations should therefore devote its energy to making continuous
product improvements
- Selling concept is the idea that consumers will not buy enough of the firm’s products unless it
undertakes a large scale selling and promotion effort
- Marketing concept is the idea that achieving organizational goals depends on knowing the needs
and wants of the target markets and delivering the desired satisfactions better than competitors do
- Societal marketing concept is the idea that a company should make good marketing decisions by
considering consumers’ wants, the company’s requirements, consumers’ long-term interests, and
society’s long-run interests.
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- The marketing environment includes the actors and forces outside marketing that affect
marketing management’s ability to build and maintain successful relationships with target
customers
- The marketing mix is the set of tools (four Ps) the firm uses to implement its marketing strategy.
It includes product, price, promotion, and place.
- Integrated marketing program is a comprehensive plan that communicates and delivers the
intended value to chosen customers.
- Mission statement: what business are we in? Forms boundaries for all decisions, objectives, and
strategies of the marketing plan
Marketing management philosophies: 4 orientations that marketers can have toward their society
1. Production: what can be done best and most convenient, internal focus, lacks customer focus
2. Sales: too much inventory so need cash, based on idea that people will buy more if aggressive sales
techniques are used and high sales result in high profits, lacks understanding of marketplace, short
term approach, not much focus on customer
3. Marketing orientation: better for small businesses, focuses on customer’s needs to distinguish
product, integrates all organizations activities to satisfy customers, deliver unique experience
4. Societal: organization exists to satisfy customers wants and needs while enhancing society’s long-
term best interests, problem that customers mixed on purchasing environmentally friendly products
bc cost more, lack of availability, and questionable effectiveness
- Strategic planning: managerial process of creating and maintaining a fit between the
organizations, objectives, and resources and evolving market opportunities…goal is long term
growth and profit which requires long term commitment of resources
- Competitive advantage: set of unique features of a company and its products that are perceived
by the target market as significant and superior to the competition.
1. Market penetration: existing markets and existing products: how? More intensive distribution, more
aggressive promotion
2. Market development: new markets and existing products: why? Existing markets are stagnant,
competition is strong
3. Product development: existing markets and new products: why? Meets changing customer needs,
meet needs of specific segments, method to retain customers
4. Diversification: new markets and new products (most risky: why? Slowing growth, competition,
risky to remain in same market with same products
Firms must gain strategic advantage by positioning their offerings against competitors’ offerings.
Consumer Markets and Consumer Behavior
- Consumer market refers to all of the personal consumption of final consumers
Characteristics Affecting Consumer Behavior
- Culture is the learned values, perceptions, wants, and behavior from family and other important
institutions
o Subculture are groups of people within a culture with shared value systems based on
common life experiences and situations
- Social classes are society’s relatively permanent and ordered divisions whose members share
similar values, interests, and behaviors
- Groups and social networks:
o Word-of-mouth influence and buzz marketing
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▪ Opinion leaders are people within a reference group who exert social influence on
others. Also called influentials or leading adopters
▪ Marketers identify them to use as brand ambassadors
o Online social networks are online communities where people socialize or exchange
information and opinions. They are interactive media content that include blogs, social
networking sites (facebook), virtual worlds (second life)
- Social Factors such as family
- Personal factors
o Occupation
o Economic situation.
o Lifestyle is a person’s pattern of living as expressed in his or her psychographics. Measures
a consumer’s AIOs (activities, interests, opinions) to capture information about a person’s
pattern of acting and interacting in the environment
o Personality refers to the unique psychological characteristics that lead to consistent and
lasting responses to the consumer’s environment
o Psychological factors
Managing Marketing Information to Gain Customer Insights
Marketing information system (MIS) consists of people and procedures for:
– Assessing the information needs
– Developing needed information
– Helping decision makers use the information for customer
It provides information to the company’s marketing and other managers and external partners such as
suppliers, resellers, and marketing service agencies.
A good MIS should balance what the information users would like to have against what they need and
what is feasible to offer.
Developing Marketing Information
1- Internal databases are electronic collections of consumer and market information obtained from
data sources within the company network. However, these information might be incomplete, or
in the wrong form for making decisions.
2- Marketing intelligence is the systematic collection and analysis of publicly available information
about consumers, competitors, and developments in the marketplace
3- Marketing research is the systematic design, collection, analysis, and reporting of data relevant to
a specific marketing situation facing an organization. It gives marketers insights into customer
motivations
a. Exploratory research
b. Descriptive research
c. Causal research
Customer-driven marketing strategy: market segmentation, targeting,
differentiation, and positioning
Market Segmentation addresses the first simple-sounding marketing question: What customers will we
serve? segmentation is the process that companies use to divide large, heterogeneous markets into small
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markets that can be reached more efficiently and effectively with products and services that match their
unique needs.
Major bases for segmenting consumer and business markets
- Geographic Segmentation: Dividing a market into different geographical units, such as nations,
states, regions, counties, cities, or even neighborhoods.
- Demographic Segmentation: Dividing the market into segments based on variables such as age,
life-cycle stage, gender, income, occupation, education, religion, ethnicity, and generation.
o Age and life-cycle segmentation: Dividing a market into different age and life-cycle
group. Family life cycle family needs and expenditures change over time, one way to
segment consumers is to consider the stage of the family life cycle they occupy.
o Gender segmentation: Dividing a market into different segments based on gender Many
products appeal to men or women either because of the nature of the product or because
the marketer chose to appeal to one sex or the other.
o Income segmentation divides the market into affluent or low-income consumers
- Psychographic segmentation: divides buyers into different groups based on social class, lifestyle,
or personality traits.
- Behavioral Segmentation divides buyers into groups based on their knowledge, attitudes, uses,
or responses to a product.
Segmentation International Markets
Companies can segment international markets using one or a combination of several variables.
- Geographic factors: Nations close to one another will have many common traits and behaviors.
- Economic factors: Population income levels and overall level of economic development
- Political and legal factors: Type and stability of government, receptivity to foreign firms,
monetary regulations, and the amount of bureaucracy
- Cultural factors: Common languages, religions, values and attitudes, customs, and behavioral
patterns.
Intermarket segmentation divides consumers into groups with similar needs and buying behaviors even
though they are located in different countries
Target Market – A target market consists of a set of buyers who share common needs or characteristics
that the company decides to serve.
Market targeting strategies:
consist of evaluating each market segment's attractiveness and selecting one or more segments to enter
- Undifferentiated: One Marketing mix to all buyers in 1 target market – An undifferentiated
strategy is one that essentially avoids segmentation, appealing to a wide-spectrum of people.
Products such as anti-freeze or candy bars use this type of approach. targets the whole market with
one offer.
- Differentiated: Differentiated marketing targets several different market segments and designs
separate offers for each.
- Concentrated/Micromarketing: Concentrated marketing targets a small share of a large market.
When a firm focuses its efforts on offering one or more products to a single segment, it is using a
concentrated strategy.
- Micromarketing is the practice of tailoring products and marketing programs to suit the tastes of
specific individuals and locations. It includes local marketing and individual marketing. Local
marketing involves tailoring brands and promotions to the needs and wants of local customer
groups—cities, neighborhoods, and even specific stores. Individual marketing has also been
labeled one-to-one marketing, mass customization, and markets-of-one marketing.
Product position is the way the product is defined by consumers on important attributes—the place the
product occupies in consumers’ minds relative to competing products
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Positioning Maps show consumer perceptions of their brands versus competing products on important
buying dimensions. Perceptual positioning maps show consumer perceptions of their brands versus
competing products on important buying dimensions.
Competitive advantage is an advantage over competitors gained by offering consumers greater value,
either through lower prices or by providing more benefits that justify higher prices
The Promotional Mix
The promotional mix is one of the 4 Ps of the marketing mix. It is the specific blend of advertising,
public relations, personal selling, and direct-marketing tools that the company uses to persuasively
communicate customer value and build customer relationships
- Advertising: Advertising is any form of impersonal (one-way) paid communication in which the
company is identified (television, radio, newspaper, social media and Internet ads).
Advertising styles:
Slice of life Lifestyle Fantasy
Personality
Mood or image Musical
symbol
Technical Scientific Testimonial or
expertise evidence endorsement
- Public Relations: The main purpose of public relations is that it helps build a positive public
image for a company, supports new product launches and sales, helps a company to evaluate
public attitudes and communicates the overall goals of the company (Press releases; Sponsorships,
special events, and Web pages)
- Sales Promotion: It contains methods of stimulating consumer purchase and is usually based on
a short-term or immediate goal. Examples of sales promotion items are contests, sweepstakes,
giveaways, free samples or coupons.
- Personal selling is the process of helping and persuading one or more prospects to purchase a
good or service or to act on any idea through the use of an oral presentation, often in a face-to-
face manner or by telephone. Examples include sales presentations, sales meetings, sales training
and incentive programs for intermediary salespeople, samples, and telemarketing
o Personnel selling process: The goal of the personal selling process is to get new
customers and obtain orders from them.
1- Prospecting identifies qualified potential customers through referrals from: Customers,
suppliers, dealers, internet
2- Qualifying is identifying good customers and screening out poor ones by looking at
financial ability, needs, location, and growth potential.
3- Pre-approach is the process of learning as much as possible about a prospect, including
needs, who is involved in the buying, and the characteristics and styles of the buyers
4- Approach is the process where the salesperson meets and greets the buyer and gets the
relationship off to a good start and involves the salesperson’s Appearance, Opening lines,
and Follow-up remarks
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5- Presentation is when the salesperson tells the product story to the buyer, presenting
customer benefits and showing how the product solves the customer’s problems
6- Handling objections is the process where salespeople resolve problems that are logical,
psychological, or unspoken
7- Closing is the process where salespeople should recognize signals from the buyer—
including physical actions, comments, and questions—to close the sale
8- Follow-up is the last step in which the salesperson follows up after the sale to ensure
customer satisfaction and repeat business
- Direct marketing involves making direct connections with carefully targeted individual consumers
to both obtain an immediate response and cultivate lasting customer relationships—through the
use of direct mail, telephone, direct-response television, e-mail, and the Internet to communicate
directly with specific consumers (Catalog, Telemarketing, Kiosks)
o Forms of direct marketing: personal selling direct marketing, direct-mail direct
marketing, catalog direct marketing, telephone marketing, direct response television
marketing, kiosk marketing, digital direct marketing, online marketing
o Online marketing:
▪ Content sponsorships provide companies with name exposure through the
sponsorship of special content such as news or financial information
▪ Alliances and affiliate programs are relationships where online companies
promote each other
▪ Viral marketing is the Internet version of word-of-mouth marketing and involves
the creation of a Web site, e-mail message, or other marketing event that customers
pass along to friends.
Integrated marketing communications is the integration by the company of its communication
channels to deliver a clear, consistent, and compelling message about the organization and its brands
Steps:
1- Identify the target audience
2- Determine the communication objectives
3- Design the message:
a. Personal communication involves two or more people communicating directly with each
other. Personal communication is effective because it allows personal addressing and
feedback.
i. Opinion leaders are people within a reference group who, because of their special
skills, knowledge, personality, or other characteristics; exerts social influence on
others
ii. Buzz marketing involves cultivating opinion leaders and getting them to spread
information about a product or service to others in their communities
b. Nonpersonal communication is media that carry messages without personal contact or
feedback, including major media, atmospheres, and events that affect the buyer directly
4- Choose the media
5- Select the message source
Marketing channels
- Supply chain (make-and-sell view):
o Upstream: companies that deliver raw materials, components, parts, information, and
expertise to create product/service-
o Downstream: marketing channels (distribution channels) that look toward the customer
- Demand chain (sense-and-respond view): Planning starts by identifying needs of target customers
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- Value delivery network: a network composed of the company, suppliers, distributors, and,
ultimately, customers who partner with each other to improve the performance of the entire system
in delivering customer value.
Product, Services, and Branding Strategy
- Product is anything that can be offered in a market for attention, acquisition, use, or consumption
that might satisfy a need or want. It is a key element in the overall marketing offering, marketing
mix planning begins with building an offering that brings value to target customers.
- This offering becomes the basis upon which the company builds profitable customer relationships
- A company’s market offering includes both tangible goods and services
Level of Product and Service
Types of Products
- Consumer products:
o Convenience products are consumer products and services that the customer usually
buys frequently, immediately, and with a minimum comparison and buying effort
o Shopping products: products and services that the customer compares carefully on
suitability, quality, price, and style
o Specialty products: are consumer products and services with unique characteristics or
brand identification for which a significant group of buyers is willing to make a special
purchase effort
o Unsought products: are consumer products that the consumer does not know about or
knows about but does not normally think of buying
- Industrial products are products purchased for further processing or for use in conducting a
business
Person marketing consists of activities undertaken to create, maintain, or change attitudes and behavior
of target consumers toward particular people
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Place marketing consists of activities undertaken to create, maintain, or change attitudes and behavior of
target consumers toward particular places
Social marketing is the use of commercial marketing concepts and tools in programs designed to
influence individuals’ behavior to improve their well-being and that of society
• Social marketing programs include public health campaigns to reduce smoking , alcoholism, drug
abuse, and obesity
Individual Product and Service Decisions
Product line is a group of products that are closely related because they function in a similar manner, are
sold to the same customer groups, are marketed through the same types of outlets, or fall within given
price ranges
Product line length is the number of items in the product line
• Line stretching
• Line filling
Brand represents the consumer’s perceptions and feelings about a product and its performance. It is the
company’s promise to deliver a specific set of features, benefits, services, and experiences consistently to
the buyers
